By William Watts, MarketWatch , Clive McKeef
Coca-Cola shares rise after third-quarter results
U.S. stocks opened slightly lower Friday after data showed
China's economic growth slowing further in the third quarter, but
investors have been heartened by a positive start to the corporate
earnings reporting season and stocks are still on track for weekly
gains.
What are major indexes doing?
The Dow Jones Industrial Average was down 37 points, or 0.1%, at
26,988, while S&P 500 was almost unchanged at 2,9976 and the
Nasdaq 100 was off 9 points at 8,148.
Stocks ended with small gains Thursday, with the Dow up 23.9
points, or 0.1%, at 27,025.88 after flipping between positive and
negative territory. The S&P 500 gained 8.26 points, or 0.3%, to
close at 2,997.95, while the Nasdaq Composite advanced 32.67
points, or 0.4%, to finish at 8,156.85.
What's driving the market?
China reported growth of the world's second-largest economy
slowed to 6% growth
(http://www.marketwatch.com/story/chinas-economic-growth-continues-to-cool-off-2019-10-17)
in the third quarter from a 6.2% pace in the second quarter, and
the slowest pace since the early 1990s, as business investment
weakened.
"Though analysts had expected to see Chinese GDP growth to be
weaker than in the previous quarters the overall expectation was of
an increase of 6.1% with a decline to below 6% at some point next
year," said Fiona Cincotta, senior market analyst at City Index, in
a note. "However, Friday's data shows that the decline is
accelerating and that trade-war frictions are taking their toll
faster than expected."
While the weaker growth might stir expectations Beijing will be
more amenable to completing a trade deal with the U.S., it's also
likely to reinforce concerns about a slowing global economy.
The Wall Street Journal reported
(https://www.wsj.com/articles/top-economic-advisers-warned-trump-on-tariffs-before-china-truce-11571391006)that
White House advisers warned Trump last week that continued
escalation of US-China trade tensions could hit the economy and
dampen his re-election chances.
Stocks were buoyed Thursday after U.K. and European Union
leaders announced a tentative agreement on Brexit, but the deal
faces a significant hurdle
(http://www.marketwatch.com/story/johnson-returns-to-london-to-drum-up-support-for-brexit-deal-2019-10-18)
in the U.K. Parliament with a debate and vote set for Saturday.
Read:What a Brexit deal would mean for U.S. stocks and global
investors
(http://www.marketwatch.com/story/what-a-brexit-deal-would-mean-for-us-stocks-and-global-investors-2019-10-17)
What's on the economic calendar?
The economic calendar
(http://www.marketwatch.com/tools/calendars/economic) features
September U.S. Conference Board leading economic indicators at 10
a.m. Eastern and a flurry of public remarks by Federal Reserve
officials, including a speech by Vice Chairman Richard Clarida on
the economic outlook and interest rates in Boston at 11:30 a.m.
Eastern.
In money markets, New York Fed President John Williams said late
Thursday
(http://www.marketwatch.com/story/feds-williams-says-central-bank-would-adjust-plan-to-soothe-funding-markets-as-appropriate-2019-10-17)that
the central bank was closely monitoring its measures to soothe
pressures in funding markets, and could adjust its plans. Since
funding markets seized up last month, the U.S. central bank has
regularly intervened to provide liquidity, offering daily
repurchasing agreements to lend out funds to market participants
thirsty for cash and announcing $60 billion of bill purchases at
least through the second half of 2020.
Federal Reserve officials are heading into their meeting in two
weeks likely to cut interest rates while debating whether they have
done enough for now to vaccinate the economy against growing risks
of a sharper slowdown, the Wall Street Journal reported
(https://www.wsj.com/articles/fed-eyes-another-rate-cut-weighs-when-to-stop-11571391003?mod=hp_lead_pos7).
The IMF and World Bank host annual meetings of global finance
chiefs in Washington D.C. Friday and Saturday.
Stocks to watch
Around 70 S&P 500 companies have reported calendar
third-quarter earnings this week and of those companies, more than
80% have posted better-than-expected results, FactSet data
shows.
American Express(AXP)
(http://www.marketwatch.com/story/american-express-stock-surges-after-earnings-rise-above-forecasts-amid-higher-card-member-spending-2019-10-18)
(http://www.marketwatch.com/story/american-express-stock-surges-after-earnings-rise-above-forecasts-amid-higher-card-member-spending-2019-10-18)earned
$2.08 per share for the third quarter
(http://www.marketwatch.com/story/american-express-stock-surges-after-earnings-rise-above-forecasts-amid-higher-card-member-spending-2019-10-18),
5 cents a share above estimates and revenue also came in above
analysts' forecast.
Coca-Cola (KO) reported adjusted quarterly profit of 56 cents
per share
(http://www.marketwatch.com/story/coca-cola-adj-eps-falls-2-to-match-consensus-2019-10-18),
in line with forecasts but revenue was higher than expected.
Coca-Cola also reported organic sales growth of 5%, beating
forecasts, and also raised its full-year guidance for revenue and
operating income.
Schlumberger(SLB) , the oil field services company beat
forecasts by 3 cents
(http://www.marketwatch.com/story/schlumberger-stock-rises-after-swinging-to-large-loss-but-adjusted-profit-and-revenue-beats-expectations-2019-10-18)with
adjusted quarterly profit of 43 cents per share and revenue was
above forecasts.
E*Trade Financial (ETFC), reported quarterly earnings of $1.08
per share
(http://www.marketwatch.com/story/e-trade-tops-q3-views-vows-to-take-market-share-in-zero-fee-environment-2019-10-17),
7 cents a share above estimates and revenue beat forecasts.
How are other markets performing?
The 10-year Treasury note yield was up 1.2 basis points to
1.769%, while the 2-year note rate was mostly unchanged at 1.607%.
The 30-year bond yield rose 1.6 basis points to 2.257%.
Oil futures traded higher Friday, but remained on track for a
weekly loss, with support tied to a fall in U.S. product
inventories despite a large jump in crude stocks. West Texas
Intermediate crude for November delivery rose 59 cents, or 1.1%, to
$54.52 a barrel, leaving the U.S. benchmark on track for a 0.4%
weekly decline. The global benchmark, as measured by December Brent
crude , was up 22 cents, or 0.4%, at $60.15 a barrel, off 0.7% for
the week.
Gold futures edged lower on Friday, failing to get a lift from a
round of weak economic data out of China or a softer U.S. dollar as
bears look for the precious metal to continue its retreat from
more-than-six-year highs set last month. Gold for December delivery
on Comex fell $4.20, or 0.3%, to $1,494.30 an ounce, while December
silver lost 6.7 cents, or 0.4%, to trade at $17.545 an ounce.
(END) Dow Jones Newswires
October 18, 2019 09:48 ET (13:48 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.